GST on forfeiture

[Rachna Gaur]

In case BG in the form of performance security is forfieted due to non performance of contract amounts to GST liability.

And if liable then the vendor will claim the input , but this being such forfeiture of panel nature , how can GST input be given to such vendor

Plz reply on such issue...

[KASTURI SETHI]

2018 (17) G.S.T.L. 451 (App. A.A.R. - GST) = 2018 (9) TMI 1185 - APPELLATE AUTHORITY FOR ADVANCE RULING MAHARASHTRA IN RE: MAHARASHTRA STATE POWER GENERATION COMPANY LIMITED

 

 

AI Summary

GST on forfeited performance security: input tax credit eligibility questioned after AAR citation; issue requires analysis
Whether forfeiture of a bank guarantee as performance security is a taxable supply under GST and whether the vendor may claim input tax credit for GST on such forfeiture are the central issues; the only reply cited an Appellate Authority for Advance Ruling reference regarding Maharashtra State Power Generation Company Limited (2018) without providing a substantive conclusion.